Nepal has requested India to withdraw the four percent additional customs duty being enforced since March 1 on Nepali exports applicable to products on which India extracts excise duty internally.

Reports quoted the an official at the ministry of industry, commerce and supplies as saying that the imposition of the additional duty was against the provision of the Nepal-India trade treaty.

The official said that the government has sent a request letter to the Indian commerce ministry to nullify the new imposition.

The trade treaty between the two countries provides preferential duty free market access to Nepali products to India except three sensitive products and four items with quantitative restrictions.

India has imposed special additional duty on Nepali exports about four years back to control the market of Nepali goods in India. The provision was later withdrawn after negotiation in the prime ministerial level.

The new notification of the Indian government regarding the custom duty states that it has been imposed as it was necessary for public interest, as per the sub section (5) of section 3 of Customs Tariff Act, 1975.

India is the largest market for Nepali products. In recent years, Nepali trade has been dependent on Indian markets and the trade deficit with India has increased greatly over the years.